Thursday, October 2, 2008

Money Made from Money

Money made from money.... ( a rambling....)

I recently watched a film called "Surfwise" about the Paskowitz family. It is the story of a father who graduated Stanford and became and MD and at some point, made a conscious decision to change the way his life was going. He married (again) and he and his wife raised 9 children in a camper and then founded a school of surfing.

The film is a documentary and was released this year. I enjoyed it. The rebel part of me nodded in agreement thru a good portion of the fathers discussion of his life and the change he made. This 84 year old still surfs every morning and still stands by and practices the beliefs he adopted when he decided to change his life. The movie moves forward and interviews the 9 adult children. About mid-film you start hearing the discontent, the 'i need to blame someone for the way my life is' of most of these adult children. During this portion of the film I kept thinking, "ive raised my two children, now 26 and 19 and I heard/hear that from them too, and funny, I remember going thru that period myself as i grew into adulthood". By the end of the film the family is rejoined, and there is no blame, just a wonderful sense of family, a sense of something very special because of the way they were raised and how they were taught and each adult child seems happy with his/her life choices. A good film, that left me feeling good.

One of the things that Doc Paskowitz talked of in the film was the idea of 'not making money from money'. This was one of the things that he had decided he would not do. The thought of "not making money from money' has rattled around in my head since I saw the film. What does it mean? What does it mean to me? Is it a feasible way to live? How closely could I get to following that precept?

The idea of making money from money, most especially in this country, is to become a usurer. What occurs here in this country, with banks, credit card companies and most large corporations is nothing short of usury (definition: usury n. , pl. -ries . The practice of lending money and charging the borrower interest, especially at an exorbitant or illegally high rate. ) The other name for what occurs is 'loan sharking'.... which usually connotes some sense of gangsters/mafia. We, as a nation have become gangsters in the handling of our business affairs....(as well as in alot of our other dealings with people & countries).

After doing a google search on the phrase "not making money from money", I came across references to this throughout written history. The Quran, the Talmud and the Torah all have restrictions on usury. I found this article on "Principles of Islamic Banking" to be a good read. http://www.usc.edu/dept/MSA/economics/nbank1.html

I particularly like this principle written about in the article: "Money is only a medium of exchange, a way of defining the value of a thing; it has no value in itself, and therefore should not be allowed to give rise to more money, via fixed interest payments, simply by being put in a bank or lent to someone else. The human effort, initiative, and risk involved in a productive venture are more important than the money used to finance it." We sure are a long way from this.

I am not wealthy. I am better off then quite a few and nowhere near as wealthy as others. Somewhere along the line I became what use to be called middle-class and which is now called upper lower class. I dont have huge savings accounts or stocks and bonds and I dont have a nest egg other than my home, to fall back on. I would gladly throw everything away in order to be happy and content. I find that having lots of things eventually winds up being an anchor that will sink me.

i'd like to think that I might be capable of living by a principle like "do not make money from money" and be content.

I was really enjoying all those nice caps, and then you went and lost it at the end... Rachel, you and I both know that we will never be free of our stuff! And, nobody will know what it's worth, so it will end up on eBay for nothing or at some flea market and poof! .... all gone!

Interesting. I'm not sure I agree that investing in a company, buying its stock, is 'making money from money'. You are making money from owning a small piece of a business that does something for money. Well, perhaps not in the mortgage world but we won't go there. Without the ability to put money back to work in another company then what do you do with it, stick it under the mattress? It loses value there, and becomes less money so is 'losing money from money' also bad? I don't know, it would be difficult for the old to continue making money from work without being supported by family. Me, I'd rather be supported by money. Too bad most of it just walked away into the Bush legacy.

jonna.... in everything i've read, it is about 'how' the money is made from money. in most situations now, it is usury, It would be nice to believe that you are owning a small piece of a business that does something for money, and that it is upfront about its business dealings and not profiting off the backs of those less fortunate but two questions beg to be answered.... 1. what is it 'doing' for the money? and 2. how is it 'doing' it? If there is no value from it, other than more money, then i think it falls into the realm of usurious and the pitfalls are those which we are seeing now in this country's financial mess.